Kids Should be Part of This Adult ConversationPosted March 22nd, 2012 by Ann O'Leary
Next week, a very adult conversation begins at the U.S. Supreme Court, but much of it will have an enormous impact on children.
For three days, lawyers will argue over the constitutionality of two major provisions in the Affordable Care Act—the so-called “individual mandate,” requiring most Americans to have health insurance, and the Medicaid expansion, requiring states to cover low-income adults regardless of whether they have children or a disability.
Congress has already acted to provide health insurance for most American children — 90 percent in 2010 — by expanding Medicaid and enacting the Children’s Health Insurance Program (CHIP). While the ACA strengthens these programs for children, it is aimed largely at expanding access to adults and ensuring that health insurance consumers—children and adults alike—are protected against unfair practices.
The Supreme Court’s case may impact both the consumer protections afforded to children, as well as the expanded access to health care provided to children and families. Here are three reasons why this case matters for kids:
No. 1: Too many children have pre-existing conditions, and without the ACA they could be denied coverage.
Today, more than one quarter of children suffer from chronic health conditions, such as asthma, obesity, or a condition associated with behavior and learning problems such as autism or ADHD. These conditions are worrisome, time consuming and expensive. If the condition is bad enough or children are poor enough, they will qualify for health coverage through Medicaid. But many more will need to rely on private insurance provided by their parents. Before the ACA, health insurance companies could refuse to cover children diagnosed with these conditions or could charge much higher rates to families with sick children. Now, they can’t.
This guarantee was part of comprehensive reform that also required nearly all American citizens and legal residents to have health insurance or pay a penalty. That way, insurance companies were protected against paying bills only for the very unhealthy and expensive customers.
There is no question that Congress had the authority to place these new requirements on insurance companies. The question before the Court is whether the law can require everyone to have insurance – the so-called “individual mandate.” If that is struck down as unconstitutional, the requirement to cover children with pre-existing conditions may go down with it—both sides in the case agree that the “individual mandate” cannot be severed from these insurance reforms even though they disagree as to whether it can be severed from the remaining parts of the law.
If the individual mandate was severed from the insurance reforms, insurance premiums could become astronomically expensive because more unhealthy than healthy people would enroll. That is why the Justice Department is arguing, and I agree, that Congress has the Constitutional authority to require all individuals to purchase insurance as a “necessary and proper” law to achieve Congress’ comprehensive insurance market reforms, requiring insurers to cover everyone and provide a community rate rather than a rate based on the individual’s health history. To ensure that all individuals with pre-existing conditions—including our children—are covered, we all must take responsibility to maintain health insurance.
No. 2: With more than one-third of all children covered by Medicaid, striking down the expansion would put their health at risk.
Since Medicaid was enacted in 1965, it has been run as a partnership between the federal government and the states, each paying a share to ensure coverage for the most vulnerable low-income individuals, including children, pregnant women, the disabled, and the elderly. States do not have to participate in the program, but all of them do.
Congress has acted numerous times either to require states to expand eligibility or to provide them the option to expand eligibility to certain populations. The latest and largest expansion was included in the ACA, which provides Medicaid coverage for anyone—and that includes children—who lives on a family income that is 133% of the poverty line or lower ($30,657 for a family of four), starting in 2014. The federal government would pay the entire cost of the expansion when it is enacted, then reduce its share to 90 percent in 2020.
Congress can only encourage states to participate; it cannot coerce them. The Court has never made clear where encouragement becomes coercion. This is its opportunity to do so. While it may appear that providing all or 90 percent of the funds for the required expansion is not coercive, 26 states are arguing that the threat to withhold all Medicaid funds if they do not comply with the required expansion under the ACA is coercive.
This matters a great deal to children’s health coverage for two reasons. First, if the court strikes down this expansion, it calls into question previous expansions that Congress enacted, including requiring states to cover many more children (and not providing them with any additional money to do so). Second, one of the glaring weaknesses of the existing Medicaid program is that it does not cover most parents of low-income children. This expansion changes that. Children thrive when their parents are healthy and well and so striking down this expansion will also put a burden on families.
No. 3: Children and their Families Need Access to Both Medicaid and Private Health Insurance.
The Affordable Care Act is set up so that children and families qualify for benefits based on family income level – the lowest-income families qualify for Medicaid, and lower middle-income families qualify for subsidies to purchase private health insurance through newly-created state health exchanges.
The hitch is that nearly one-quarter of families who qualify for Medicaid one year may earn too much to qualify the next year and, thus, will need both the subsidies provided by the exchange and the insurance reform protections so that they can access and afford insurance for their children. The reverse holds true, as well.
The Affordable Care Act makes these transitions as smooth as possible by requiring states to set up “one door” policies so that families will get the help they need no matter where they apply. For the ACA to cover all low- and middle-income families and those switching between the two, both the Medicaid expansion and the insurance reforms should be upheld.
As all eyes turn to the Supreme Court next week, the legal arguments will often seem impenetrable. But here is the bottom line for children: the Court needs to uphold the individual mandate and the insurance reforms that go with it so children with pre-existing conditions receive coverage; and the Court needs to approve the Medicaid expansion so low-income American families—not just the wealthy—have access to quality health-care coverage for a chance at quality lives.
Cross posted with author permission from the Huffington Post.